Retailers Wary of Impact That China Tariffs Will Have on Their Businesses
The Trump administration said on Monday that it would proceed with plans to impose a series of punitive trade-related measures on China in the next month, intensifying pressure on Beijing as trade talks between the countries continue. The White House said in a statement that the United States would move ahead with its plan to levy 25 percent tariffs on $50 billion of imported Chinese goods, despite recent remarks by Steven Mnuchin, the Treasury secretary, and other administration officials that the tariffs would be suspended while the countries continued their negotiations. The final list of goods that will be subject to the tariffs will be outlined by June 15, and the duties would be imposed shortly after that, the White House statement said.
Total Retail's Take: The announcement that the White House is carrying through with its promise to impose tariffs on imported Chinese goods leaves many U.S. retailers in a precarious position — eat the losses associated with paying higher prices to their product suppliers in China, pass those cost increases on to consumers, or search for another place to acquire their product. Driving up the cost of imported goods from China will ultimately be absorbed by consumers in the form of higher prices, argues the National Retail Federation (NRF). A recent study by NRF and the Consumer Technology Association found tariffs on $50 billion of Chinese imports, coupled with retaliation promised by China, would reduce U.S. gross domestic product by nearly $3 billion and destroy 134,000 American jobs.
"The lack of clarity surrounding the administration’s plans is creating significant uncertainty for American businesses, disrupting supply chains and threatening to undermine the economic gains we’ve seen over the past year,” said NRF President and CEO Matthew Shay.